We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn’t mean that they don’t have occasional colossal losses; they do (like Melvin Capital’s recent GameStop losses). However, it is still a good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards PVH Corp (NYSE:PVH).
PVH Corp (NYSE:PVH) has seen an increase in hedge fund interest in recent months. PVH Corp (NYSE:PVH) was in 38 hedge funds’ portfolios at the end of September. The all time high for this statistic is 44. Our calculations also showed that PVH isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. Keeping this in mind we’re going to go over the latest hedge fund action encompassing PVH Corp (NYSE:PVH).
John Armitage of Egerton Capital
Do Hedge Funds Think PVH Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 38 of the hedge funds tracked by Insider Monkey were long this stock, a change of 36% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards PVH over the last 25 quarters. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
The largest stake in PVH Corp (NYSE:PVH) was held by Pzena Investment Management, which reported holding $773.3 million worth of stock at the end of September. It was followed by Lone Pine Capital with a $339 million position. Other investors bullish on the company included Egerton Capital Limited, Viking Global, and Melvin Capital Management. In terms of the portfolio weights assigned to each position Stormborn Capital Management allocated the biggest weight to PVH Corp (NYSE:PVH), around 3.87% of its 13F portfolio. Pzena Investment Management is also relatively very bullish on the stock, designating 3.06 percent of its 13F equity portfolio to PVH.
With a general bullishness amongst the heavyweights, some big names have been driving this bullishness. Egerton Capital Limited, managed by John Armitage, established the largest position in PVH Corp (NYSE:PVH). Egerton Capital Limited had $259.7 million invested in the company at the end of the quarter. Alexander Mitchell’s Scopus Asset Management also initiated a $33.4 million position during the quarter. The other funds with brand new PVH positions are Gregg Moskowitz’s Interval Partners, Bruce Emery’s Greenvale Capital, and Michael Gelband’s ExodusPoint Capital.
Let’s also examine hedge fund activity in other stocks similar to PVH Corp (NYSE:PVH). We will take a look at Pearson PLC (NYSE:PSO), Chemed Corporation (NYSE:CHE), Legend Biotech Corporation (NASDAQ:LEGN), OneMain Holdings Inc (NYSE:OMF), Plains All American Pipeline, L.P. (NASDAQ:PAA), Companhia Siderurgica Nacional (NYSE:SID), and Polaris Inc. (NYSE:PII). This group of stocks’ market caps resemble PVH’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PSO | 8 | 15064 | 1 |
| CHE | 20 | 272040 | -10 |
| LEGN | 14 | 947002 | -5 |
| OMF | 41 | 1047061 | 0 |
| PAA | 7 | 51655 | 0 |
| SID | 11 | 46539 | -1 |
| PII | 15 | 287576 | -5 |
| Average | 16.6 | 380991 | -2.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.6 hedge funds with bullish positions and the average amount invested in these stocks was $381 million. That figure was $2157 million in PVH’s case. OneMain Holdings Inc (NYSE:OMF) is the most popular stock in this table. On the other hand Plains All American Pipeline, L.P. (NASDAQ:PAA) is the least popular one with only 7 bullish hedge fund positions. PVH Corp (NYSE:PVH) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for PVH is 81.5. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 28.6% in 2021 through November 30th and beat the market again by 5.6 percentage points. Unfortunately PVH wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on PVH were disappointed as the stock returned 3.9% since the end of September (through 11/30) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
Follow Pvh Corp. (NYSE:PVH)
Follow Pvh Corp. (NYSE:PVH)
Suggested Articles:
- Billionaire Steve Cohen’s Top 10 Stock Picks
- 11 Best Quantum Computing Stocks To Buy Now
- 10 Best Summer Stocks to Buy Now
Disclosure: None. This article was originally published at Insider Monkey.
